INTERNATIONAL INDIAN SCHOOL, RIYADH
GRADE – XII
ACCOUNTANCY
FIRST TERM WORSHEET – 2013 – 14
Unit I Accounting for partnership firms – Fundamentals
1. What is meant by unlimited liability of a partner?
2. State one difference between fixed capital account and fluctuating capital account of
partners.
3. What is meant by partnership deed?
4. List any four essential features / elements of partnership.
5. State any four contents of partnership deed.
6. J and K are partners in a firm. Their capitals are J Rs 300000 and K Rs 20000. During the
year ended 30 – 03 – 2010 the firm earned a profit of Rs 150000. Assuming that the
normal rate of return is 20%. Calculate the value of goodwill of the firm.
i.
By capitalization method and
ii.
By super profit method if the goodwill is valued at 2 years purchase of super
profits.
7. How does the factor ‘location’ affect the goodwill of the firm?
8. Define goodwill.
9. What are super profits?
10. The total capital employed by a partnership firm is Rs 100000 and its super profit is Rs.
5000. Normal rate of return is 20 % in similar forms working under similar conditions.
Calculate the average profit of the firm.
11. D, E and F were partners in a firm sharing profits in the ratio of 5: 7: 8. Their fixed
capitals were D Rs 500000, E Rs700000 and F Rs 800000. Their partnership deed
provided for the following:
i.
Interest on capital @ 10 % p.a.
ii.
Salary of Rs10000 per month of F
iii.
Interest on drawings @ 12% p.a.
D withdrew Rs 40000 on 31st January 2009; E withdrew Rs 50000 on 31st March 2009 and F
withdrew Rs30000 on 31st December.
During the year ended on 31st December 2009 the firm earned a profit of Rs 350000.
Prepare a profit and loss Appropriation Account for the year ended 31st December 2009.
12. K and R were partners in a firm sharing profits in the ratio of 7:3. Their fixed capitals
ware K Rs 900000 and R Rs 400000. The partnership deed provided for the following
but the profit for the year was distributed without providing for
i.
Interest on capital @9% p.a.
ii.
K’s salary is Rs50000 per year R’s salary Rs 3000 per month. The profit for the
year ended 31-3-2007 was Rs 278000. Pass the Adjustment entry.
Unit – 2
Accounting for partnership firms – Reconstitution and Disolution
1. List any two situations which may result the reconstitution of a partnership firm.
2. State the meaning of sacrificing ratio.
3. What are accumulated losses?
4. Give the meaning of gaining ratio.
5. Why are assets revalued at the time of admission of a partner?
6. L and M are partners in a firm sharing profits and losses in the ratio of 7:3. They admit N
on 3/7 shares which he takes 2/7 from L and 1/7 from M. Calculate new profit sharing
ratio.
7. A and B are partners which capitals of Rs 26000 and Rs 22000 respectively. They admit
C as a partner with ¼ the share in the profit of the firm. C brings Rs 26000 as his share of
capital. Give journal entry to record goodwill on C’s admission.
8. Ali and Arib were partners in a firm sharing profits in 4:1 ratio. They had insured their
lives jointly for Rs Rs 500000. Ali died three months after the date of last balance sheet.
According to the partnership deed, legal representatives of deceased partner were entitled
to the following payments.
i.
This capital Rs 150000 as per the last balance sheet.
ii.
Interest on capital @ 12 % p.a. up to the date of death.
iii.
His share of profits to the date of death calculated on the basis of average profits
for the last three years were Rs 100000 Rs 180000 and Rs200000.
Prepare Ali’s capital Account to be rendered to his representative and the Executors
Account.
9. P, Q and R are partners in a firm in the ratio of 5:3:2. On 31st December 2010 the form
was dissolved. On dissolution the following particulars are available.
i.
Assets realized Rs 170000 after a loss of Rs 20000.
ii.
Liabilities were paid Rs 27000 including an unrecorded liability of Rs1000.
iii.
Realization expenses paid Rs 700.
iv.
On the date of dissolution, partner’s capital was in the ratio of 2:2:1.
Prepare realization A/c, partner’s capital A/c and cash Account.
10. Given below is the Balance sheet of K and S who are partners in a firm sharing profits in
the ratio of 3:2
Liabilities
Assets
Creditors
15000
Reserves
5000
Plant
30000
Patents
5000
Capital A/c :-
Furniture
3000
K – 30000
Stock
16000
50000
Destors
15000
70000
Cash
S – 20000
1000
70000
On the date M is admitted as a partner for 1/5th share on the following terms.
a) He is to contribute Rs 14000 as share of capital which includes his share of premium for
goodwill.
b) Goodwill is valued at 2 years purchase the average profits of the last 4 years, which were
Rs 10000, Rs9000, Rs 8000 and Rs 13000 respectively.
c) Plant to written down to Rs 25000 and patents written by Rs 8000
d) Un recorded investments Rs 7000.
Prepare the Revaluation A/c , partners capital A/c and Balance sheet of the new firm.
11. X, Y and Z were partners in a firm sharing profits in 5:3:2 ratio. On 31st March 2006 Z
retired from the firm on the date of Z’s retirement, the Balance sheet of the firm was as
follows.
Balance sheet of X , Y and Z as on 31 – 3 – 2006
Liabilities
Rs
Assets
Rs
Creditors
27000
Bank
80000
Bills payable
13000
Outstanding rent
22500
(-) provision for
doubtful debts(500)
19500
Provision for legal
claim
57500
Stock
21000
Capitals :X
127000
Y
91000
Z
71000_____
20000
Furniture
Land and Building
87500
200000
288000
408000
408000
On Z’s retirement it was agreed that
1. Land and Building will be appreciated by 5 % and Furniture will be depreciated
by 20 %.
2. Provision for doubtful debts will be made at 5% on debtors and provision for legal
claims will be made at Rs 60000.
3. Goodwill of the firm was valued at Rs. 60000.
4. Rs 70000 from Z’s capital A/c will be transferred to his loan A/c and the balance
will be paid to him by a cheque.
Prepare revaluation A/c, partners capital A/c and Balance sheet of X and Y after Z,s
retirement.
Prepared by
R.V. Ashok Mehta